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Naira Gains 0.03% at I&E as Foreign Reserves Drop to $43.9b

By Dipo Olowookere

The local currency traded mixed against the Dollar at the foreign exchange market (forex) last week as more money is pumped into the economy by politicians wooing delegates and party members for votes ahead of the 2019 general elections.

At the Investors & Exporters (I&E) forex window, the Naira appreciated by 0.03 percent against the Dollar to quote at N363.82.

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The marginal rise came on the back of further decline in the nation’s external reserves that fell by 0.86 percent to settle at $43.92 billion as at Thursday, October 4, 2018.

According to analysts at Cowry Asset, the local currency however, was flattish week-on-week (w-o-w) at the interbank market at N361.34/$.

This was mainly due to the weekly injections of $210 million by Central Bank of Nigeria (CBN) into the foreign exchange market via the Secondary Market Intervention Sales (SMIS).

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During this intervention, the apex bank supplied the sum of $100 million to Wholesale (SMIS), $55 million to Small and Medium Scale Enterprises and $55 million was sold for invisibles.

Also, the exchange rate remained unchanged at both the Bureau De Change (BDC) segment and the parallel market at N358/$ and N361/$ respectively amid CBN’s sustained special intervention.

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Meanwhile, most dated foreign exchange rate forward contracts at the interbank over-the-counter (OTC) segment rose; 1 month, 2 months, 3 months and 6 months contracts lost 0.15 percent, 0.11 percent, 0.08% and 1.04 percent to close N367.42/$, N371.05/$, N374.64/$, N386.29/$ respectively.

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Dipo Olowookere is a journalist based in Nigeria that has passion for reporting business news stories. At his leisure time, he watches football and supports 3SC of Ibadan.

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